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Public Opinion Influences the Level and Effectiveness of Foreign Aid

February 2, 2009 Pamela Paxton and Stephen Knack

During severe economic downturns such as the world is experiencing, public attitudes toward aid will determine whether or not donor governments will be able to generate support from voters and taxpayers for more aid.

The Monterrey Declaration (2002) set a target for Official Development Assistance of 0.7 percent of donor countries’ national incomes, an amount large donor countries have yet to deliver. Public support for aid provision in these countries will determine not only whether or not this target is achieved, but increasingly also the effectiveness of each aid dollar spent.

In The Bottom Billion, Paul Collier asserts that the key obstacle to reforming aid is public opinion in donor countries, and that bilateral aid agencies not backed by strong public support are overly risk averse and thus use more of their aid for projects that produce tangible, measurable outputs.[1, p. 83]

Aid provided as stand-alone projects and micromanaged by donors is thought to be less effective in most cases than aid provided in more flexible forms. Moreover, aid is believed to be more effective when it is insulated from the diplomatic, commercial, and other goals of donor countries.[2]

The Paris Declaration set a series of targets for changing the way aid is delivered

Source: Multilateral aid share reported in the World Bank’s Global Monitoring Report 2007. Support for increased aid obtained from the Gallup International “Voice of the People” survey for 2002.

Meeting the Paris Declaration (2005) goal of increasing the impact of development outcomes will require substantial increases in the share of aid funds managed by recipient governments, and reductions in the share of “ring-fenced” projects managed by donors. Among bilateral donors, greater public support for aid is associated with greater reliance on recipient-country systems.[3]

The OECD-Development Assistance Committee (DAC) encourages donor countries to funnel much of their aid through multilateral institutions such as the World Bank, regional development banks, and the United Nations system.

Figure 1 shows a strong and positive relationship between support for increased aid in donor countries and the share of aid that countries funnel through multilateral agencies. But where public opinion is less supportive of aid, governments are less willing to yield control to multilateral institutions over how it is spent.

Support for aid varies with personal traits

An analysis of data from two large cross-country surveys in donor countries finds that support for aid varies with religiosity, political ideology, trust, satisfaction with one’s own financial situation, and other personal traits.[4] The World Values Survey (WVS) (1995) covers nearly 6,000 respondents from 9 donor countries [5], and the “Voice of the People” (VoP) survey by Gallup International (2002) includes more than 6,000 respondents in 17 donor countries. The two surveys together cover 19 donor countries, minus France, the only sizeable donor country left out.[6]

Respondent characteristics associated with greater or lesser support for aid provision included the following:

• gender: support for aid was higher among women and lower among men• geographic identity: support for aid was lower among respondents who identified more strongly with their nation, state or region, or locality and higher among those who identified more strongly with “the world as a whole”• income: support for aid was greater among those with higher incomes• interest in politics: support for aid was higher among respondents interested in politics• own financial situation: controlling for income, support for aid was lower among those concerned about their own economic well-being; the onset of recessions in most donor countries is likely to further weaken support for aid• political ideology: support for aid was higher among respondents left of center (Figure 2)• reasons for poverty: support for aid was lower among respondents who think escaping poverty is easy or that poor people are lazy• religiosity: support for aid is greater among respondents with regular religious practices, but is unrelated to religious beliefs• trust: support for aid was higher among respondents with greater trust in fellow citizens, their own government, NGOs, the United Nations and the World Bank.

At the country-level, support for aid is higher in countries with former colonies, and lower in countries with larger populations. This country size effect is due largely to the United States and Japan, which have the largest populations and the lowest support for aid.

In smaller nations, citizens are more likely to interact with foreigners and be knowledgeable about international affairs, including global poverty. Furthermore, citizens in donor countries with experience as a colonial power are likely to be more aware of development issues and to feel a greater sense of responsibility for the welfare of people in former colonies and other developing countries.

The United States appears exceptional in these analyses. It ranks last in support for aid among the 9 WVS countries and is tied (with Japan) for last among the 17 VoP countries. If U.S. aid as a share of GNI had been equal to that of France—the median value among the other 21 DAC members—total DAC aid in 2007 would have been higher by nearly one-third, increasing from $103.7 billion to about $136 billion. Increasing U.S. aid is challenging, however, in the face of low public support.

Donors need to develop trust in development institutions

Improving the effectiveness of aid requires that donors be more willing to accept risks and hence a higher rate of failure, but, “at present, the powerful force of public opinion is driving agencies in precisely the opposite direction” [1, p. 184]. Where support for aid is shallow and citizens are ill-informed about foreign affairs and development issues, “vociferous lobbies” may influence opinion and distort aid policies.

Better understanding the factors that influence public support for foreign aid can assist the donor community in identifying constraints to aid quantity and quality, in attempting to meet the Monterrey and Paris targets. It can also contribute to more realistic assessments of how likely and how soon donors will reach these targets.

PAMELA PAXTON is an Associate Professor in the Sociology Department, Ohio State University. Her research interests include political sociology, women in politics, and social capital.

STEPHEN KNACK is a Lead Economist in the Development Research Group and the Poverty Reduction and Economic Management Network of the World Bank. His research interests include the impact of aid on policy reform and on public sector capacity and accountability.

6. The WVS is a superior data source for investigating respondent-level influences because it includes many more questions than the VoP, but it is less useful in studying country-level factors than the VoP which includes nearly twice as many countries.